Legislature(2021 - 2022)
2022-02-09 House Journal
Full Journal pdf2022-02-09 House Journal Page 1804 HB 44 Representative Tuck moved and asked unanimous consent that the House consider the Senate message (page 1757) on the following: 2022-02-09 House Journal Page 1805 CS FOR HOUSE BILL NO. 44(STA) "An Act relating to the practice of accounting." and SENATE CS FOR CS FOR HOUSE BILL NO. 44(L&C) am S (same title) There being no objection, it was so ordered. Representative Eastman moved and asked unanimous consent that the following legal memo be spread on the journal. There being no objection, it was so ordered. Memorandum dated February 9: "TO: Representative David Eastman FROM: Noah Klein, Legislative Counsel You asked who must be licensed to issue a "report" under AS 08.04.505, as amended by SCS CSHB 44(L&C) am S (the senate committee substitute)? You asked whether, after the removal of "financial statements," engineers or legislators would have to, in some instances, receive an accountant license to issue engineering or other reports? It is unlikely a court would interpret the statute to require such extreme results. As you noted, currently AS 08.04.505 provides in part: "Only a person who holds a valid license, practice privilege, permit, or out-of-state exemption may issue a report on financial statements of another person or governmental unit." If the legislature enacts the senate committee substitute, it will delete "financial statements," among other changes, and AS 08.04.505 will provide in part: "Only a person who holds a valid license, practice privilege, or permit may issue a report on behalf of another person or governmental unit." You asked which reports would require a license, privilege, or permit after this change? The Alaska Supreme Court has explained that "when construing a statute, 'we must, whenever possible, interpret each part or section of a 2022-02-09 House Journal Page 1806 statute with every other part or section, so as to create a harmonious whole.'" Both in current statute and under the senate committee substitute, AS 08.04.505(3) establishes an exception for "the performance by persons of other services involving the use of accounting skills, including the preparation of tax returns, management advisory services, and the preparation of financial statements without the issuance of reports on them." The language "other services involving the use of accounting skills" create a distinction between services involving the use of accounting skills that require a license, privilege, or permit and other services involving accounting skills that do not require a license, privilege, or permit. The word other would be superfluous if the restriction on reporting did not specifically apply to services involving accounting skills. Additionally, it is unlikely that a court would read a section within a chapter specifically regulating the practice of accounting to impose a broad restriction on reporting outside the practice of accounting. Finally, the definition of the "practice of public accounting," as amended by sec. 40 of the senate committee substitute, refers to "accounting or auditing skills." Thus, after the removal of "financial statements," the requirement to obtain a license, privilege, or permit before issuing a report applies to accounting reports involving the use of accounting skills other than reports explicitly excepted in AS 08.04.505(1) - (3)." Representative Tuck moved that the House concur in the Senate amendment and recommended that the members vote yes. The question being: "Shall the House concur in the Senate amendment?" The roll was taken with the following result: SCS CSHB 44(L&C) am S Concur YEAS: 39 NAYS: 0 EXCUSED: 1 ABSENT: 0 Yeas: Carpenter, Claman, Cronk, Drummond, Eastman, Edgmon, Fields, Foster, Gillham, Hannan, Hopkins, Johnson, Josephson, Kaufman, Kreiss-Tomkins, Kurka, LeBon, McCabe, McCarty, McKay, Merrick, Nelson, Ortiz, Patkotak, Prax, Rasmussen, Rauscher, Schrage, Shaw, Snyder, Story, Stutes, Tarr, Thompson, Tilton, Tuck, Vance, Wool, Zulkosky 2022-02-09 House Journal Page 1807 Excused: Spohnholz And so, the House concurred in the Senate amendment, thus adopting SCS CSHB 44(L&C) am S. The Chief Clerk notified the Senate. The bill was referred to the Chief Clerk for enrollment.